NCPA - National Center for Policy Analysis

Dropouts To Be Required To Return Federal Grant Moneys

August 16, 1999

The Education Department has proposed requiring college dropouts to return federal grant funds regardless of how much they spend before quitting school. The new rules are expected to take effect after a public comment period ending September 15.

  • An estimated 1.1 million Pell Grant recipients can each get a maximum of $3,125 per year.
  • The $6.3 billion program was responsible for 10 percent of federal student aid last year.
  • Repayment would be required if a student dropped out before completing 60 percent of an academic term -- but if he completes more than that, the assumption would be that he has earned 100 percent of the aid.
  • The department says it does not know how many Pell Grant recipients drop out in an average year.

The department says that aid is awarded to students with the expectation that they will complete the period of time for which the aid has been awarded.

Source: Associated Press, "Payback Time for Dropouts?" Washington Post, August 13, 1999.


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